Drinks America Holdings Ltd. (DKAM) skyrockets on sale

Posted on: Monday, June 13th, 2011
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Drinks America Holdings Ltd. (OTCBB: DKAM) shares spiked 44% Monday to 36-100ths of a cent, on the sale of a 49% interest in the company to Worldwide Beverage Imports, LLC. Volume for the stock amounted to 24.9 million shares, dwarfing a daily average of 2.2 million.

The Wilton, Connecticut-based company announced Monday that that it has entered into a letter of intent with Worldwide, which will result in the latter acquiring up to a 49% interest in the Company. Worldwide will acquire approximately 125 million shares of common stock of the Company in exchange for sales and or importing and distribution rights of Worldwide products through a series of licensing agreements between the companies.

In addition to the shares of common stock for the distribution rights to each of the new products, Worldwide will make a capital contribution in the Company of no less than $1.5 million, through cash provided by the sale of Worldwide products by Drinks or otherwise. Upon the consummation of the transaction, Worldwide will have acquired an interest not to exceed 49% of the Company.

Drinks CEO J. Patrick Kenny was quoted in the June 13 press release, commenting, “The products and the resources in the combined companies will provide a significant platform and will position our Company for growth and expansion. The key hurdle for Drinks has been access to production capital in today’s debt markets.”

Kenny concluded, “This transaction provides Drinks with production and inventory resources for both our existing and newly added products and strengthens the Company exponentially.”

Worldwide currently markets products produced by Fabrica de Tequilas Finos, S.A. de C.V., the seventh largest independent tequila distillery in the world, including Kah Tequila, Agave 99 Tequila and Ed Hardy Tequila, and the beer products produced by Cervecería Mexicana, S. de R.L. de C.V., the third largest brewery in Mexico, including Mexicali Beer, Rio Bravo Beer, Chili Beer and Red Pig Ale. Drinks has recently launched Rheingold Beer and also markets Old Whiskey River Bourbon, Aguila Tequila, Damiana and is an owner of Olifant Vodka. The combined brands are expected to be distributed and marketed in all 50 states with Drinks acting as either importer and distributor or primary sales agent for the combined brands.

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Category: OTCBB, Penny Stocks
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